Sweeney’s School Funding Reform Plan Becomes Law

Landmark Legislation Sets Course for Full & Fair Funding for All NJ School Districts

Cliffside Park – Senate President Steve Sweeney’s plan to reform school funding was signed into law today by Governor Phil Murphy, putting in place a state aid formula that will provide full and fair funding for all of New Jersey’s school districts. The landmark legislation, S-2, will allow the state to live up to the promise of the decade-old school funding law that was widely praised but never fully realized.

“This plan will allow New Jersey to realize the promise of full and fair funding for all of the state’s school districts so they are supported in their work to provide a quality education to each and every student,” said Senator Sweeney. “These reforms will ensure that the continued increases in school aid will be used effectively. State aid will now be distributed according to each district’s property tax wealth, its ability to pay, enrollment changes, and the special needs of its schoolchildren – which is the way the formula is supposed to work.”

The new law will help restore fairness to the state’s school aid formula by eliminating the “growth caps” that denied districts with growing enrollments the funds they are entitled to and will phase-out the “adjustment aid” that went to districts for students they no longer have. These two flaws created a funding imbalance that severely hampered the state’s ability to distribute school aid equitably. The adjustment aid will be phased down over a seven-year timeframe.

“We are finally fixing the flaws inserted into the original school funding law by lifting the growth cap to ensure that growing districts receive the funding they deserve and by phasing out the so-called adjustment aid that districts have been receiving for students they no longer have,” said Senator Sweeney, who has fiercely advocated for the need reforms for years. Lifting the growth cap and phasing out adjustment aid ensures that state aid ‘follows the child’ as the funding law intended.”

The newly-enacted state budget increases school aid by $347 million, continuing the ramp-up to full funding led by Senator Sweeney last year. School districts in 17 of New Jersey’s 21 counties will receive a net increase in funding in the upcoming school year, delivering increases for school districts that educate 72 percent of the state’s schoolchildren.

The budget bill includes a five percent reduction in adjustment aid for the upcoming 2018-2019 school year, and the Sweeney legislation calls for additional reductions of eight percent in 2019-2020, then by 10 percent, 14 percent, 18 percent, 21 percent and 24 percent through 2024-2025, when all “hold harmless” funding would be eliminated and these districts would be at 100 percent funding.

To ensure that districts receive the needed support, former Abbott districts that are facing adjustment aid cuts – some of which are taxing far below the state average – will be given cap waivers authorizing them to raise school property taxes to their full Local Fair Share.

The law also creates a category of aid called “vocational expansion stabilization aid” to ensure vocational technical schools receive either the amount determined under the formula or the amount of aid received in the 2017-2018 school year, whichever is greater. This will address the unique needs of the vocational schools which cannot raise their own taxes to offset any reductions in state aid.

“The signing of S-2 brings an end to New Jersey’s punishing school funding practice and begins the process of closing the school aid gap between the under- and overfunded districts,” said Dr. James J. Lavender, Superintendent of Kingsway Regional School District. “We are indebted to Senate President Sweeney for his leadership, persistence and fortitude in ensuring that all school districts are treated equitably under the eyes of the law. As a result, Kingsway’s 3,000 students makeup the nearly one million students state-wide who become the ultimate benefactor.”

“Freehold Borough is exceptionally pleased with the signing of bill S-2 into law,” Freehold Borough School District Superintendent Rocco Tomazic said. “The district recognizes Senator Sweeney as the essential architect of this initiative. Freehold Borough and all the underfunded districts now have a clear path to full funding under the SFRA. Senator Sweeney had the vision to know what to do to fix the problem and stood firm until the plan became reality. From our students, staff and parents – thank you.”